Quarterly Fiscal Report Q4 GFS Publication

Democratic Republic of Timor-Leste

Ministry of Finance

Executive Summary

At the end of December 2013, the General Government of Timor-Leste (GGoTL),

including Petroleum and Donor Funds ran a net operating balance of $2,729.1

million and had a net lending capacity of $2,371.5

million. However without the

Petroleum and Donor Funds, the GGoTL ran a net operating balance of $158.5

million. Therefore although the Government is able to sustain its current level of

operations, it is still strongly reliant on the Petroleum Fund and the cash balance.

General Directorate State Finance

Economy Policy Directorate

QUARTERLY FISCAL BULLETIN

October

–

December 2013

GOVERNMENT FINANCE STATISTICS (GFS)

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 2

1.

Revenues

Total revenues in 2013 for the GGoTL, Petroleum and Donor funds amounted to $3,607.3 million: $148.9 million from

non-oil revenues,1 $3,297.4million from oil revenues and $161.0million from donor revenues2.

1.1 Non-oil Revenues

Non-oil revenues are composed of taxes, grants and other revenues:

Non-oil taxes totalled $106.6 million during 2013, which was 72% of non-oil revenues. These are divided into:

Taxes on income, profits and capital gains totalled $39.7 million at the end of 2013, 6.7% higher than $37.2 million collected in 2012.

Taxes on goods and services were the largest source of tax revenue in 2013, totalling $54.1 million (7.8% higher than the $50.2 million collected in 2012). This increase has been mostly due to the increase in excise tax collection, which contrasted with the fall of vehicle and business registration fees in 2013.

Taxes on international trade and transactions amounted to $12.6 million at the end of 2013, 6% lower than the $13.4 million collected in 2012. The reduction was due to a decrease in the collection of import duties.

Other taxes totalled $0.2 in 2013.

Other revenue collected a total of $42.3 million in 2013, 14.9% higher than the $36.8 million obtained in 2012.

1.2 Oil Revenues

Oil revenues are divided into:

Taxes in 2013 totalled $1,167.3 million, mostly due to taxes on income, profits and capital gains.

Other revenue was the major revenue source for the Petroleum Fund, mostly due to property income. Other revenues include profit from oil, first tranche petroleum, interest, trust and dividend income and totalled $2,130.2 million in 2013.

1.3 Donor Fund Revenues

Revenues in the Donor Fund are obtained by means of grants received from all development partners. This total amounted to $161.0 million by the 31st December 2013.

2.

Expenses

Expenses incurred by the GGoTL, including the Petroleum and Donor Funds in 2013 amounted to $878.2 million. $720.3

million was spent by the GGoTL alone; $739.7 million were expenses in the Petroleum Fund ($730.0 million of which

were grants to the GGoTL); whilst $148.2million were expenditures in the Donor Fund.

2.1 General Government Expenditures

Expenditure categories for GGoTL are composed of:

Compensation of Employees totalled $141.7 million in 2013. This was 8.3% higher than the $130.9 million spent in 2012.

1

$148.9 million is obtained by subtracting total oil grants ($730.0 million) from total domestic revenues ($878.9 million).

2

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 3 Use of Goods & Services was 52% of total expenses, reaching $375.6 million in 2013 and 13.2% higher than the $331.8 million spent during the same period of 2012. This rise has been brought about mostly by increases on professional services, fuel for generators, local staff training and technical support.

Social benefits were 21.3% lower in 2013 than in 2012, amounting to $124.3 million in 2013. The reduction was mostly due to a fall in personal transfers to the Secretary of State for Vocational Training and a fall in transfers by the Ministry of Defence and by the Ministry of Social Solidarity.

Other expenses reached $78.8 million at the end of 2013, 13.2% higher than the $69.6 million spent 2012. This was mostly due to higher public grant expenditures.

2.2 Petroleum Fund Expenditures

Petroleum Fund expenses reached $739.7 million in 2013 and were composed of management costs and transfers to the GGoTL: 99% of this total ($730.0 million) was allocated to grants transferred to the GGoTL, whilst the remaining 1% ($9.7 million) corresponded to management fees.

2.3

Donor Fund Expenditures

$148.2million has been spent by the Donor Fund in 2013: $7.6 million on Compensation of Employees; $59.9 million on

Use of Goods and Services and $80.7 million on Other Expenses.

3.

Net Operating Balance

The net operating balance is calculated as revenues minus expenses and it shows the Gover e t’s a ility to sustai its

current level operations, given revenues and expenses.3

The General Government of Timor-Leste (GGoTL), including Petroleum and Donor Funds was running a net operating

surplus of $2,729.1million at the end of 2013, which is a strong fiscal position. However, the net operating balance for

the GGoTL without the Petroleum and Donor Funds and without including Petroleum Fund grants was -$571.5 million4.

Therefore, petroleu reve ues play a key role i the GGoTL’s fis al surplus.

4.

Net Acquisition of Non-Financial Assets

Net Acquisition of Non-Fi a ial Assets re ords tra sa tio s that ha ge GGoTL’s holdi gs of non-financial assets. It is

broadly equivalent to capital expenditure as recorded in the Charter of Accounts in Timor-Leste.

At the end of December 2013 total acquisition of non-financial assets stood at $357.6million for the GGoTL including

Petroleum and Donor Funds. The GGoTL has undergone net acquisition of non-financial assets worth $344.8 million (31.9% lower than the $506.1 million spent by the same date in 2012). The Petroleum Fund did not record any expense under this category and the Donor Fund spent $12.8 million.

5.

Net Lending/Borrowing

Net Lending/Borrowing is total expenditure minus revenue. The combination of total revenue, expenditures and acquisition of non-financial assets made net lending for the GGoTL with the Petroleum and Donor Funds $2,371.5 million at the end of 2013. This means that the GGoTL, with the Petroleum and Donor Funds, had a surplus which is being invested in financial assets.

3

In Timor-Leste, Gross and Net Operating Balance are the same, as there is no inventory for depreciation of fixed capital to date.

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 4

6.

Net Acquisition of Financial Assets

The increase in the Gover e t’s holdi gs of fi a ial assets is re orded u der et acquisition of financial assets. In the

case of Timor-Leste, the net lending capacity is being invested in a range of financial assets including shares, securities, deposits, cash and other equities, mostly through the Petroleum Fund.

The net acquisition of financial assets for the GGoTL, Petroleum and Donor Fund at the close of 2013 was $2,991.8 million. This was composed of two parts: $186.3 million withdrawn from the CFTL cash balance by the GGoTL (which explains why the value is negative for currency and deposits in the tables in the annex) and $3,178.1 million invested in financial instruments in the Petroleum Fund.

It must also be noted that due to the unrealized market value of financial assets in the Petroleum Fund, the total acquisition of financial assets is larger than net lending. This unrealized market value of financial assets is recorded under Other Economic Flows and reached $620.4 million at the end of December 2013.

7.

Financial Conclusion

The GGoTL including Petroleum and Donor Funds had a strong fiscal position at the closing of 2013: It ran a net

operating balance of $2,729.1 million and had a net lending capacity of $2,371.5million. Total net lending capacity was

then being invested in financial assets. However, without the Petroleum and Donor Funds, the Government would not be in such a strong fiscal position and would need to borrow 186.3 million to maintain its current level of operations.

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 5

Annex: Statement of Total Government Operations

Figure 1. Accumulated Statement of Government Operations the whole of 2013

Data for 2013, in millions of US dollars.

Consildated Fund, Infrastructu re Fund and

Human Capital Fund Petroleum Fund Donor Fund Operations Between Government Units Total

Revenue 1 878.9 3,297.4 161.0 (730.0) 3,607.3

Taxes 11 106.6 1,167.3 36.2 - 1,310.1

Taxes on income, profits, and capital gains 111 39.7 1,151.0 - - 1,190.7

Taxes on goods & services 114 54.1 12.8 - - 67.0

Taxes on international trade & transactions 115 12.6 - - - 12.6

Other taxes 116 0.2 3.4 - - 3.6

- - -

-Grants 13 730.0 - 133.1 (730.0) 133.1

Other revenue 14 42.3 2,130.2 27.9 - 2,200.4

Property income 141 3.4 2,121.9 - - 2,125.3

Other 142-145 38.8 8.3 - - 47.1

Expense 2 720.3 739.7 148.2 (730.0) 878.2

Compensation of employees 21 141.7 - 7.6 - 149.3

Use of goods & services 22 375.6 9.7 59.9 - 445.1

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - 730.0 - (730.0)

-Social benefits 27 124.3 - - - 124.3

Other expense 28 78.8 - 80.7 - 159.4

Gross operating balance [1-2+23] GOB 158.5 2,557.7 12.9 - 2,729.1

Net operating balance [1-2] NOB 158.5 2,557.7 12.9 - 2,729.1

Net acquisition of nonfinancial assets 31 344.8 - 12.8 - 357.6

Acquisition of nonfinancial assets 311 344.8 - 12.8 - 357.6

Buildings & Structures 3111 306.6 - 0.2 - 306.8

Machinery & Equipment 3112 38.2 - - - 38.2

- - -

-Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB (186.3) 2,557.7 0.0 - 2,371.5

Net acquisition of financial assets 32 (186.3) 3,178.1 - - 2,991.8

by instrument - - - -

-Currency and deposits 3202 (186.3) 211.7 - - 25.4

Securities other than shares 3203 - 2,023.0 - - 2,023.0

Shares and other equity 3205 - 883.3 - - 883.3

Other accounts receivable 3208 - 60.1 - - 60.1

Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB-] NLBz - 620.3 (0.0) - 620.3

Memorandum item: - - - -

-Other Economic Flows - 620.4 - - 620.4

Total expenditure [2+31] 2M 1,065.1 739.7 161.0 (550.0) 1,415.8

Note: Statistical Discrepancy should be zero.

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 6

Figure 2. Statement of government operations until the 4th quarter 2013- Timor-Leste (GGoTL, Petroleum and Donor Funds)

Data for 2013, in millions of US dollars.

Revenue 1 1,090.7 934.8 828.8 752.9 3,607.3

Taxes 11 390.6 356.8 294.6 268.1 1,310.1

Taxes on income, profits, and capital gains 111 372.3 300.2 274.1 244.1 1,190.7

Taxes on goods & services 114 15.6 17.0 17.6 16.8 67.0

Taxes on international trade & transactions 115 2.6 3.2 2.9 3.9 12.6

Other taxes 116 0.1 0.1 0.0 3.4 3.6

Grants 13 64.3 36.2 32.6 - 133.1

Other revenue 14 635.9 578.1 501.7 484.8 2,200.4

Property income 141 620.1 570.5 496.1 438.7 2,125.3

Other 142-145 15.8 7.6 5.6 18.2 47.1

Expense 2 124.6 195.2 196.2 362.2 878.2

Compensation of employees 21 32.7 33.8 37.8 45.0 149.3

Use of goods & services 22 60.0 78.5 89.1 217.5 445.1

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - - 1.0 (1.0)

-Social benefits 27 13.5 42.0 22.7 46.1 124.3

Other expense 28 18.4 40.9 45.6 54.6 159.4

Gross operating balance [1-2+23] GOB 966.1 739.7 632.7 390.7 2,729.1

Net operating balance [1-2] NOB 966.1 739.7 632.7 390.7 2,729.1

Net acquisition of nonfinancial assets 31 22.2 38.8 91.9 204.7 357.6

Acquisition of nonfinancial assets 311 22.2 38.8 91.9 204.7 357.6

Buildings & Structures 3111 11.9 37.4 89.0 168.4 306.8

Machinery & Equipment 3112 - - 2.9 35.3 38.2

Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB 943.9 700.8 540.7 186.0 2,371.5 Net acquisition of financial assets 32 1,152.7 485.7 892.6 460.8 2,991.8

by instrument - - - -

-Currency and deposits 3202 (6.5) (123.6) 18.5 136.9 25.4

Securities other than shares 3203 827.9 412.5 582.2 200.4 2,023.0

Shares and other equity 3205 317.2 178.0 275.7 112.3 883.3

Other accounts receivable 3208 14.1 18.7 16.1 11.1 60.1

Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB-] NLBz 208.8 (215.1) 351.9 274.8 620.3

Memorandum item: - - - -

-Other Economic Flows 208.8 (215.1) 351.9 274.8 620.4

Total expenditure [2+31] 2M 146.8 234.0 468.1 566.9 1,415.8

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory

Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 7

Data for 2013, in millions of US dollars.

Revenue 1 29.9 35.2 211.6 602.2 878.9

Taxes 11 21.0 26.9 25.3 33.4 106.6

Taxes on income, profits, and capital gains 111 6.7 11.2 9.0 12.8 39.7

Taxes on goods & services 114 11.6 12.4 13.3 16.8 54.1

Taxes on international trade & transactions 115 2.6 3.2 2.9 3.9 12.6

Other taxes 116 0.1 0.1 0.0 - 0.2

Grants 13 - - 180.0 550.0 730.0

Other revenue 14 9.0 8.3 6.3 18.7 42.3

Property income 141 1.4 0.7 0.7 0.6 3.4

Other 142-145 7.5 7.6 5.6 18.2 38.8

Expense 2 68.7 158.1 161.7 331.7 720.3

Compensation of employees 21 30.4 32.8 34.9 43.6 141.7

Use of goods & services 22 24.8 63.5 82.9 204.4 375.6

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - - 1.0 (1.0)

-Social benefits 27 13.5 42.0 22.7 46.1 124.3

Other expense 28 0.0 19.9 20.2 38.6 78.8

Gross operating balance [1-2+23] GOB (38.8) (122.9) 49.8 270.5 158.5 Net operating balance [1-2] NOB (38.8) (122.9) 49.8 270.5 158.5 Net acquisition of nonfinancial assets 31 11.9 37.4 91.7 203.7 344.8

Acquisition of nonfinancial assets 311 11.9 37.4 91.7 203.7 344.8

Buildings & Structures 3111 11.9 37.4 88.8 168.4 306.6

Machinery & Equipment 3112 - - 2.9 35.3 38.2

Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB (50.7) (160.4) (41.9) 66.8 (186.3)

Net acquisition of financial assets 32 (50.7) (160.4) (41.9) 66.8 (186.3)

by instrument - - - -

-Currency and deposits 3202 (50.7) (160.4) (41.9) 66.8 (186.3)

Securities other than shares 3203 - - - -

-Shares and other equity 3205 - - - -

-Other accounts receivable 3208 - - - -

-Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB-] NLBz - - - -

-Memorandum item: - - - -

-Other Economic Flows - - - -

-Total expenditure [2+31] 2M 80.6 195.6 253.5 535.4 1,065.1

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 8

Figure 4. Accumulated statement of government operation for the Petroleum Fund

Data for 2013, in millions of US dollars.

Revenue 1 996.5 863.5 764.7 672.8 3,297.4

Taxes 11 369.6 293.7 269.3 234.7 1,167.3

Taxes on income, profits, and capital gains 111 365.6 289.1 265.1 231.3 1,151.0 Taxes on goods & services 114 4.0 4.6 4.3 - 12.8 Taxes on international trade & transactions 115 - - - - -Other taxes 116 - - - 3.4 3.4

Grants 13 - - - -

-Other revenue 14 626.9 569.8 495.4 438.1 2,130.2

Property income 141 618.6 569.8 495.4 438.1 2,121.9 Other 142-145 8.3 - - - 8.3

Expense 2 1.9 2.3 182.0 553.5 739.7

Compensation of employees 21 - - - - -Use of goods & services 22 1.9 2.3 2.0 3.5 9.7 Consumption of fixed capital 23 - - - - -Interest 24 - - - - -Grants 26 - - 180.0 550.0 730.0 Social benefits 27 - - - - -Other expense 28 - - - - -Gross operating balance [1-2+23] GOB 994.6 861.2 582.6 119.3 2,557.7

Net operating balance [1-2] NOB 994.6 861.2 582.6 119.3 2,557.7

Net acquisition of nonfinancial assets 31 - - - -

-Acquisition of nonfinancial assets 311 - - - - -Buildings & Structures 3111 - - - - -Machinery & Equipment 3112 - - - - -Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB 994.6 861.2 582.6 119.3 2,557.7 Net acquisition of financial assets 32 1,203.4 646.1 934.5 394.0 3,178.1

by instrument - - - -

-Currency and deposits 3202 44.2 36.8 60.5 70.2 211.7 Securities other than shares 3203 827.9 412.5 582.2 200.4 2,023.0 Shares and other equity 3205 317.2 178.0 275.7 112.3 883.3

Other accounts receivable 3208 14.1 18.7 16.1 11.1 60.1

Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - - -Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB-] NLBz 208.8 (215.1) 351.9 274.8 620.3 Memorandum item: - - - -

-Other Economic Flows 208.8 (215.1) 351.9 274.8 620.4

Total expenditure [2+31] 2M 1.9 2.3 182.0 553.5 739.7

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 9

Figure6. Accumulated statement of government operation for the Donors Fund

Data for 2013, in millions of US dollars.

Revenue 1 64.3 36.2 32.6 27.9 161.0 Taxes 11 - 36.2 - - 36.2

Taxes on income, profits, and capital gains 111 - - - -

-Taxes on goods & services 114 - - - -

-Taxes on international trade & transactions 115 - - - -

-Other taxes 116 - - - -

-Grants 13 64.3 36.2 32.6 - 133.1 Other revenue 14 - - - 27.9 27.9

Property income 141 - - - -

-Other 142-145 - - - -

-Expense 2 54.0 34.8 32.4 27.0 148.2

Compensation of employees 21 2.2 1.0 2.9 1.4 7.6

Use of goods & services 22 33.4 12.8 4.1 9.6 59.9

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - - - -

-Social benefits 27 - - - -

-Other expense 28 18.4 21.0 25.3 16.0 80.7

Gross operating balance [1-2+23] GOB 10.3 1.4 0.2 1.0 12.9

Net operating balance [1-2] NOB 10.3 1.4 0.2 1.0 12.9

Net acquisition of nonfinancial assets 31 10.3 1.4 0.2 1.0 12.8

Acquisition of nonfinancial assets 311 10.3 1.4 0.2 1.0 12.8

Buildings & Structures 3111 - - 0.2 - 0.2

Machinery & Equipment 3112 - - - -

-Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB - 0.0 (0.0) 0.0 0.0 Net acquisition of financial assets 32 - - - - -by instrument - - - -

-Currency and deposits 3202 - - - -

-Securities other than shares 3203 - - - -

-Shares and other equity 3205 - - - -

-Other accounts receivable 3208 - - - -

-Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB] NLBz - (0.0) - (0.0) (0.0)

Memorandum item: - - - -

-Other Economic Flows - - - -

-Total expenditure [2+31] 2M 64.3 36.2 32.6 27.9 161.0

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory

Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 10

Key Terminology

Compensation of employees are remuneration in cash or kind, payable to an employee in return for work done and social insurance contributions made by a general government unit on behalf of its employees. Compensation of employees is incurred on a monthly basis in Timor-Leste.

Expenses include all transactions that decrease the net worth of the general government sector. Expenditures are financed from the ESI, excess withdrawals from the Petroleum Fund, loans or the use of cash balance.

General Government of Timor-Leste is the combination of the Consolidated Fund (CFTL), Human Capital and Development Fund (HCDF) and the Infrastructure Fund in Timor-Leste.

Grants: are non-compulsory current or capital transfers from one government unit to another government unit or an international organization. These are divided into estimated sustainable income (ESI) and excess withdrawals.

Gross Operating Balance is the revenue minus expenses other than consumption of fixed capital. It indicates whether the government is able to sustain its current level of operations and ideally should portray a surplus. However consumption of fixed capital is not measured in Timor-Leste, therefore Gross Operating Balance is equal to Net Operating Balance.

Net lending/borrowing is a balancing item defined as the net acquisition of all financial assets less the net incurrence of all liabilities from transactions. It is thus a summary measure indicating the extent to which GGoTL is either putting financial resources at the disposal of other sectors in the economy or utilizing the financial resources generated by other sectors.

Net Operating Balance is equal to revenue minus expenses and indicates whether the government is able to sustain its

current level of operations.

Other Revenue includes a variety of forms of revenue earned by GGoTL including property income, sales of goods, fines & penalties and other miscellaneous revenue.

Revenues are all transactions that increase the net worth of general government sector and exclude domestic and external borrowing. Revenues tend to increase during the last period of the year, due to the collection of accumulated taxes.

Social benefits are current transfers to households to provide for needs arising from events such as sickness, unemployment, retirement, housing or family circumstances.

Taxes on goods & services are taxes levied on the production, extraction, sale, transfer, leasing or delivery of goods and rendering of services.

Taxes on income, profits, and capital gains are composed of corporate taxes in Timor-Leste.

Quarterly Fiscal Bulletin Oct-Dec 2013 Page 11 Transactions in financial assets and liabilities record financial transactions. I.e. they record transactions that change a

gover e t’s holdi gs of fi a ial assets a d lia ilities. I Timor-Leste financial assets are all composed of currency and deposit.

Transactions in nonfinancial assets and liabilities re ord tra sa tio s that ha ge a gover e t’s holdi gs of nonfinancial assets. In Timor-Leste these assets are classified as Buildings & Structures and Machinery & Equipment. Use of goods & services includes total value of goods and services purchased by the general government sector for use in a production process or acquired for resale less the net change in inventories of those goods and services.

Quarterly Fiscal Bulletin Oct-Dec 2013

Page 6

Figure 2. Statement of government operations until the 4th quarter 2013- Timor-Leste (GGoTL, Petroleum and Donor Funds)

Data for 2013, in millions of US dollars.

Revenue 1 1,090.7 934.8 828.8 752.9 3,607.3

Taxes 11 390.6 356.8 294.6 268.1 1,310.1

Taxes on income, profits, and capital gains 111 372.3 300.2 274.1 244.1 1,190.7

Taxes on goods & services 114 15.6 17.0 17.6 16.8 67.0

Taxes on international trade & transactions 115 2.6 3.2 2.9 3.9 12.6

Other taxes 116 0.1 0.1 0.0 3.4 3.6

Grants 13 64.3 36.2 32.6 - 133.1

Other revenue 14 635.9 578.1 501.7 484.8 2,200.4

Property income 141 620.1 570.5 496.1 438.7 2,125.3

Other 142-145 15.8 7.6 5.6 18.2 47.1

Expense 2 124.6 195.2 196.2 362.2 878.2

Compensation of employees 21 32.7 33.8 37.8 45.0 149.3

Use of goods & services 22 60.0 78.5 89.1 217.5 445.1

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - - 1.0 (1.0)

-Social benefits 27 13.5 42.0 22.7 46.1 124.3

Other expense 28 18.4 40.9 45.6 54.6 159.4

Gross operating balance [1-2+23] GOB 966.1 739.7 632.7 390.7 2,729.1

Net operating balance [1-2] NOB 966.1 739.7 632.7 390.7 2,729.1 Net acquisition of nonfinancial assets 31 22.2 38.8 91.9 204.7 357.6 Acquisition of nonfinancial assets 311 22.2 38.8 91.9 204.7 357.6

Buildings & Structures 3111 11.9 37.4 89.0 168.4 306.8

Machinery & Equipment 3112 - - 2.9 35.3 38.2

Consumption of fixed capital [=23] 313 - - - - -Net lending / borrowing [1-2-31 = 1-2M] NLB 943.9 700.8 540.7 186.0 2,371.5

Net acquisition of financial assets 32 1,152.7 485.7 892.6 460.8 2,991.8

by instrument - - - -

-Currency and deposits 3202 (6.5) (123.6) 18.5 136.9 25.4

Securities other than shares 3203 827.9 412.5 582.2 200.4 2,023.0

Shares and other equity 3205 317.2 178.0 275.7 112.3 883.3 Other accounts receivable 3208 14.1 18.7 16.1 11.1 60.1

Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB-] NLBz 208.8 (215.1) 351.9 274.8 620.3

Memorandum item: - - - -

-Other Economic Flows 208.8 (215.1) 351.9 274.8 620.4

Total expenditure [2+31] 2M 146.8 234.0 468.1 566.9 1,415.8

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory

Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013

Page 7

Data for 2013, in millions of US dollars.

Revenue 1 29.9 35.2 211.6 602.2 878.9 Taxes 11 21.0 26.9 25.3 33.4 106.6 Taxes on income, profits, and capital gains 111 6.7 11.2 9.0 12.8 39.7 Taxes on goods & services 114 11.6 12.4 13.3 16.8 54.1 Taxes on international trade & transactions 115 2.6 3.2 2.9 3.9 12.6 Other taxes 116 0.1 0.1 0.0 - 0.2 Grants 13 - - 180.0 550.0 730.0 Other revenue 14 9.0 8.3 6.3 18.7 42.3

Property income 141 1.4 0.7 0.7 0.6 3.4 Other 142-145 7.5 7.6 5.6 18.2 38.8 Expense 2 68.7 158.1 161.7 331.7 720.3

Compensation of employees 21 30.4 32.8 34.9 43.6 141.7 Use of goods & services 22 24.8 63.5 82.9 204.4 375.6 Consumption of fixed capital 23 - - - - -Interest 24 - - - - -Grants 26 - - 1.0 (1.0) -Social benefits 27 13.5 42.0 22.7 46.1 124.3 Other expense 28 0.0 19.9 20.2 38.6 78.8 Gross operating balance [1-2+23] GOB (38.8) (122.9) 49.8 270.5 158.5 Net operating balance [1-2] NOB (38.8) (122.9) 49.8 270.5 158.5 Net acquisition of nonfinancial assets 31 11.9 37.4 91.7 203.7 344.8

Acquisition of nonfinancial assets 311 11.9 37.4 91.7 203.7 344.8 Buildings & Structures 3111 11.9 37.4 88.8 168.4 306.6 Machinery & Equipment 3112 - - 2.9 35.3 38.2

Consumption of fixed capital [=23] 313 - - - - -Net lending / borrowing [1-2-31 = 1-2M] NLB (50.7) (160.4) (41.9) 66.8 (186.3) Net acquisition of financial assets 32 (50.7) (160.4) (41.9) 66.8 (186.3) by instrument - - - -

-Currency and deposits 3202 (50.7) (160.4) (41.9) 66.8 (186.3) Securities other than shares 3203 - - - - -Shares and other equity 3205 - - - -

-Other accounts receivable 3208 - - - - -Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - - -Other accounts payable 3308 - - - - -Statistical discrepancy [32 - 33 - NLB-] NLBz - - - - -Memorandum item: - - - - -Other Economic Flows - - - -

-Total expenditure [2+31] 2M 80.6 195.6 253.5 535.4 1,065.1 Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013

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Figure 4. Accumulated statement of government operation for the Petroleum Fund

Data for 2013, in millions of US dollars.

Revenue 1 996.5 863.5 764.7 672.8 3,297.4

Taxes 11 369.6 293.7 269.3 234.7 1,167.3

Taxes on income, profits, and capital gains 111 365.6 289.1 265.1 231.3 1,151.0 Taxes on goods & services 114 4.0 4.6 4.3 - 12.8 Taxes on international trade & transactions 115 - - - - -Other taxes 116 - - - 3.4 3.4

Grants 13 - - - -

-Other revenue 14 626.9 569.8 495.4 438.1 2,130.2

Property income 141 618.6 569.8 495.4 438.1 2,121.9 Other 142-145 8.3 - - - 8.3

Expense 2 1.9 2.3 182.0 553.5 739.7

Compensation of employees 21 - - - - -Use of goods & services 22 1.9 2.3 2.0 3.5 9.7 Consumption of fixed capital 23 - - - - -Interest 24 - - - - -Grants 26 - - 180.0 550.0 730.0 Social benefits 27 - - - - -Other expense 28 - - - -

-Gross operating balance [1-2+23] GOB 994.6 861.2 582.6 119.3 2,557.7

Net operating balance [1-2] NOB 994.6 861.2 582.6 119.3 2,557.7

Net acquisition of nonfinancial assets 31 - - - -

-Acquisition of nonfinancial assets 311 - - - - -Buildings & Structures 3111 - - - - -Machinery & Equipment 3112 - - - - -Consumption of fixed capital [=23] 313 - - - -

-Net lending / borrowing [1-2-31 = 1-2M] NLB 994.6 861.2 582.6 119.3 2,557.7

Net acquisition of financial assets 32 1,203.4 646.1 934.5 394.0 3,178.1

by instrument - - - - -Currency and deposits 3202 44.2 36.8 60.5 70.2 211.7 Securities other than shares 3203 827.9 412.5 582.2 200.4 2,023.0 Shares and other equity 3205 317.2 178.0 275.7 112.3 883.3

Other accounts receivable 3208 14.1 18.7 16.1 11.1 60.1

Net incurrence of liabilities 33 - - - -

-Loans 3304 - - - - -Other accounts payable 3308 - - - - -Statistical discrepancy [32 - 33 - NLB-] NLBz 208.8 (215.1) 351.9 274.8 620.3 Memorandum item: - - - -

-Other Economic Flows 208.8 (215.1) 351.9 274.8 620.4

Total expenditure [2+31] 2M 1.9 2.3 182.0 553.5 739.7 Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013

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Figure6. Accumulated statement of government operation for the Donors Fund

Data for 2013, in millions of US dollars.

Revenue 1 64.3 36.2 32.6 27.9 161.0

Taxes 11 - 36.2 - - 36.2

Taxes on income, profits, and capital gains 111 - - - -

-Taxes on goods & services 114 - - - -

-Taxes on international trade & transactions 115 - - - -

-Other taxes 116 - - - -

-Grants 13 64.3 36.2 32.6 - 133.1

Other revenue 14 - - - 27.9 27.9

Property income 141 - - - -

-Other 142-145 - - - -

-Expense 2 54.0 34.8 32.4 27.0 148.2

Compensation of employees 21 2.2 1.0 2.9 1.4 7.6

Use of goods & services 22 33.4 12.8 4.1 9.6 59.9

Consumption of fixed capital 23 - - - -

-Interest 24 - - - -

-Grants 26 - - - -

-Social benefits 27 - - - -

-Other expense 28 18.4 21.0 25.3 16.0 80.7 Gross operating balance [1-2+23] GOB 10.3 1.4 0.2 1.0 12.9 Net operating balance [1-2] NOB 10.3 1.4 0.2 1.0 12.9 Net acquisition of nonfinancial assets 31 10.3 1.4 0.2 1.0 12.8 Acquisition of nonfinancial assets 311 10.3 1.4 0.2 1.0 12.8

Buildings & Structures 3111 - - 0.2 - 0.2

Machinery & Equipment 3112 - - - -

-Consumption of fixed capital [=23] 313 - - - - -Net lending / borrowing [1-2-31 = 1-2M] NLB - 0.0 (0.0) 0.0 0.0 Net acquisition of financial assets 32 - - - - -by instrument - - - -

-Currency and deposits 3202 - - - -

-Securities other than shares 3203 - - - -

-Shares and other equity 3205 - - - - -Other accounts receivable 3208 - - - - -Net incurrence of liabilities 33 - - - - -Loans 3304 - - - -

-Other accounts payable 3308 - - - -

-Statistical discrepancy [32 - 33 - NLB] NLBz - (0.0) - (0.0) (0.0)

Memorandum item: - - - - -Other Economic Flows - - - - -Total expenditure [2+31] 2M 64.3 36.2 32.6 27.9 161.0

Note: Statistical Discrepancy should be zero.

Consumption of fixed capital will have to be calculated from inventory Total Quarter 1

Total Quarter 2

Total Quarter 3

Total Quarter 4

Accumulated Total

Quarterly Fiscal Bulletin Oct-Dec 2013

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Key Terminology

Compensation of employees

are remuneration in cash or kind, payable to an employee in return for work done and

social insurance contributions made by a general government unit on behalf of its employees. Compensation of

employees is incurred on a monthly basis in Timor-Leste.

Expenses

include all transactions that decrease the net worth of the general government sector. Expenditures are

financed from the ESI, excess withdrawals from the Petroleum Fund, loans or the use of cash balance.

General Government of Timor-Leste

is the combination of the Consolidated Fund (CFTL), Human Capital and

Development Fund (HCDF) and the Infrastructure Fund in Timor-Leste.

Grants:

are non-compulsory current or capital transfers from one government unit to another government unit or an

international organization. These are divided into estimated sustainable income (ESI) and excess withdrawals.

Gross Operating Balance

is the revenue minus expenses other than consumption of fixed capital. It indicates whether

the government is able to sustain its current level of operations and ideally should portray a surplus. However

consumption of fixed capital is not measured in Timor-Leste, therefore Gross Operating Balance is equal to Net

Operating Balance.

Net lending/borrowing

is a balancing item defined as the net acquisition of all financial assets less the net incurrence of

all liabilities from transactions. It is thus a summary measure indicating the extent to which GGoTL is either putting

financial resources at the disposal of other sectors in the economy or utilizing the financial resources generated by other

sectors.

Net Operating Balance

is equal to revenue minus expenses and indicates whether the government is able to sustain its

current level of operations.

Other Revenue

includes a variety of forms of revenue earned by GGoTL including property income, sales of goods, fines

& penalties and other miscellaneous revenue.

Revenues

are all transactions that increase the net worth of general government sector and exclude domestic and

external borrowing. Revenues tend to increase during the last period of the year, due to the collection of accumulated

taxes.

Social benefits

are current transfers to households to provide for needs arising from events such as sickness,

unemployment, retirement, housing or family circumstances.

Taxes on goods & services

are taxes levied on the production, extraction, sale, transfer, leasing or delivery of goods and

rendering of services.

Taxes on income, profits, and capital gains

are composed of corporate taxes in Timor-Leste.

Quarterly Fiscal Bulletin Oct-Dec 2013

Page 11

Transactions in financial assets and liabilities

record financial transactions. I.e. they record transactions that change a

gover

e t’s holdi gs of fi a ial assets a d lia ilities. I

Timor-Leste financial assets are all composed of currency and

deposit.

Transactions in nonfinancial assets

and liabil

ities re ord tra sa tio s that ha ge a gover

e t’s holdi gs of

nonfinancial assets. In Timor-Leste these assets are classified as Buildings & Structures and Machinery & Equipment.

Use of goods & services

includes total value of goods and services purchased by the general government sector for use

in a production process or acquired for resale less the net change in inventories of those goods and services.